BlackBerry boosts outlook on software growth; concerns remain
By Alastair Sharp
WATERLOO, Ontario (Reuters) - BlackBerry Ltd (BB.TO: Quote) BBRY.O, helped by its higher-margin software business, reported better-than-expected adjusted earnings and raised its full-year growth forecast on Tuesday, though concerns about overall revenue growth reversed early share gains.
BlackBerry Chief Executive John Chen said at a midday event with reporters that he expected it would take another four or five quarters to halt the steady decline in the company's overall revenue.
BlackBerry shares, which gained as much as 4.4 percent on the earnings report, retreated after the comments and ended the session down 3 percent.
"I don't consider ourselves in a turnaround anymore," Chen told reporters at the company's Waterloo, Ontario headquarters. "Now we need to execute for growth."
BlackBerry has gone through a wrenching transition in recent years as it tries to build a software business not tied directly to its smartphones, which have lost ground in the iPhone and Android era and are now being made and sold by others.
While still a year from overall revenue growth, investors cheered Blackberry's improved outlook and the growing role of the software business - which includes mobile device management products, the QNX industrial operating system, and a range of recent acquisitions.
"The part of the business that represents the future continues to show, I think, reasonably good progress," said IDC analyst John Jackson.
Chen said software sales should grow at least 15 percent in the fiscal year beginning in March, after sticking to a 30 percent growth target for the current fiscal year. Continued...